The Euro has clawed back from earlier weakness to trade higher for the session on Tuesday. Buyers came in at 1.14390 as the currency approached a pair of bottoms at 1.1433 and 1.1432. Traders are vigorously defending these levels because they are potential trigger points of an acceleration to the downside.
At 1406 GMT, the EUR/USD is trading 1.1469, up 0.0007 or +0.06%.
Daily Technical Analysis
The main trend is down according to the daily swing chart. A trade through 1.1433 will negate a closing price reversal bottom. A move through 1.1432 will signal the resumption of the downtrend. The daily chart is wide open under this level with the next main bottom coming in at 1.1301. The main trend will change to up on a move through 1.1622.
The minor trend is also down. A move through 1.1555 will change the minor trend to up. This will also shift momentum to the upside.
The main range is 1.1301 to 1.1816. Its retracement zone at 1.1498 to 1.1559 is resistance. Trading below this zone is helping to maintain the downside bias.
The short-term range is 1.1622 to 1.1433. Its retracement zone at 1.1527 to 1.1550 is another resistance area.
Combining the two retracement zones makes 1.1550 to 1.1559 the strongest resistance area.
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Daily Technical Forecast
Based on the early price action, the direction of the EUR/USD on Tuesday is likely to be determined by trader reaction to 1.1433 to 1.1432.
Holding above 1.1433 to 1.1432 will indicate the presence of buyers. If this creates enough upside momentum then look for an initial drive into 1.1498. This is followed by a downtrending Gann angle at 1.1422.
Since the main trend is down, look for selling on the initial test of the Gann angle at 1.1422. Overtaking this angle could trigger a further rally into the short-term 50% level at 1.1527, followed by a resistance cluster at 1.1550, 1.1555 and 1.1559.
Taking out 1.1432 with conviction could trigger the start of a major break. The first target is a downtrending Gann angle at 1.1562.
Crossing to the weak side of the Gann angle at 1.1562 will put the EUR/USD in an extremely bearish position. This could trigger an eventual break into the August 15 main bottom at 1.1301.